Visa Inc announced on Monday that it would allow users to settle transactions on its payment network using the cryptocurrency USD Coin, the biggest sign of mainstream monetary acceptance of digital currencies.
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According to Reuters, the company started the pilot program with payment and crypto network Crypto.com and expects to expand the program to more partners later this year.
On the news, Bitcoin, the most famous crypto coin, jumped to a one-week-high, rising as much as 4.5% to $58,300 and returning to a record high above $61,000 set earlier this month.
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In a subsequent announcement, Visa confirmed the details.
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The USD Coin (USDC) is a stablecoin cryptocurrency that is directly linked to the US dollar.
Visa’s move comes as financial institutions such as BNY Mellon, BlackRock Inc, and Mastercard Inc work to expand their use of cryptocurrencies for financing and payment applications.
“We see increasing demand from consumers across the world to be able to access, hold and use digital currencies and we’re seeing demand from our clients to be able to build products that provide that access for consumers,” Cuy Sheffield, head of crypto at Visa, said.
If a customer wishes to pay for a coffee with a Crypto.com Visa card, the digital currency stored in a cryptocurrency wallet must first be converted into conventional money.
Traditional fiat currency will be deposited in a bank account and wired to Visa at the end of the day to settle any transactions, increasing the expense and uncertainty for companies.
Visa’s new change, which will allow use of the Ethereum blockchain, removes the need to convert digital currency into fiat currency in order to complete a transaction.
Visa partnered up with digital asset bank Anchorage earlier this month, with Crypto.com sending USDC to Visa’s Ethereum address in Anchorage as the first transaction.
Elon Musk, the CEO of Tesla Inc and a strong proponent of cryptocurrencies, announced last week that customers can purchase Tesla electric vehicles using bitcoin, in the hopes of encouraging more widespread adoption of the digital currency.
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